Binance Fined $2.25 Million by India’s FIU for Anti-Money Laundering Regulations

The post Binance Fined $2.25 Million by India’s FIU for Anti-Money Laundering Regulations appeared first on Coinpedia Fintech News

The world’s leading blockchain and cryptocurrency platform Binance has been fined Rs 18.82 crore ($2.25 million) by India’s Financial Intelligence Unit (FIU) for failing to comply with anti-money laundering regulations. This fine is necessary for Binance to restart its operations in India.

The penalty follows Binance’s registration with the FIU in May, which was required after the exchange received a show-cause notice in December 2023. 

This notice was issued to Binance and eight other offshore exchanges, including KuCoin, Huobi, Kraken, Gate.io, Bittrex, Bitstamp, MEXC Global, and Bitfinex, for violating local regulations.

The Fine and Regulatory Violations 

The Director of FIU-India found that Binance was operating in India without meeting proper regulations under the Prevention of Money Laundering Act (PMLA). After an in-depth review of Binance’s submissions, it was found that Binance had failed to comply with local anti-money laundering regulations. 

Therefore, the exchange has been fined Rs 18.82 crore ($2.25 million) to restart its operations in the country.

To prevent further violations, Binance has been issued specific directions to ensure diligent compliance with the obligations outlined in Chapter IV of the PMLA of 2002, and the PMLA Maintenance of Record Rules of 2005. These rules are crucial for preventing money laundering activities and combating the financing of terrorism.

India’s Regulatory Efforts

This fine is part of a larger initiative to align international exchanges with local regulations. Earlier Indian government also ordered the blocking of these exchanges’ URLs in India in January, and their apps were delisted from Google and Apple app stores.

Recently, Binance and KuCoin were recognized as the first offshore crypto entities registered with FIU, marking a significant step in ensuring strict AML compliance required by Indian authorities.

Binance’s Global Regulatory Issues

Binance is also facing regulatory challenges globally, as the former CEO of Binance Changpeng Zhao, was sentenced to four months in prison for violating US anti-money laundering laws earlier this year. 

Additionally, Binance is appealing against a $4.4 million fine in Canada for failing to register as a foreign money services business and not reporting large virtual currency transactions. This appeal follows a $4.3 billion settlement in the United States over similar violations, leading to Binance’s exit from the Canadian market last year.

Also Read: Nigerian Court Dismisses Human Rights Lawsuit by Binance Executive Nadeem Anjarwalla